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As a defense I mean. It started making a comeback as a government tactic shortly after September 11 before it migrated to the non-national security law enforcement world.

And the Seventh Circuit appears to be the new home of the entrapment defense as it rises, phoenix-like, on the shores of Lake Michigan. In United States v. Barta, the Seventh Circuit again affirmed the new strength of an entrapment defense in that part of the country.

If you remember one quote from this opinion, remember this one: "The point is that the government is supposed to catch criminals, not create them."

Mr. Barta's Business

James Barta founded a company called Sav-Rx. Sav-Rx was a "prescription benefit management business." I believe that means that they help businesses that offer a prescription benefit to their employees with that.

Mr. Barta Meets with the FBI (Unwittingly)

In any event, Mr. Barta came to meet with a man named Castro. Or, referred to as Castro, since he was actually an undercover FBI agent. Castro was known as a guy who could deliver contracts with people at Los Angeles County. He delivered those contracts by bribing them.

When Mr. Barta first met with Castro he told him, right off the jump, "I'm not trying to sell you anything." He said he was merely there to tell Castro what Sav-Rx does.

Castro told Mr. Barta that he could connect Sav-Rx with the Los Angeles County government because he knew a guy and he'd need to be paid. Barta left twelve minutes after the meeting started.

Mr. Barta and the Limits of His Business

Castro met with Mr. Barta again, along with an FBI informant. They told Barta that they could set up a system where Sav-Rx would be able to do work with LA County through the guy they knew on the inside.

Mr. Barta described how he had helped Cook County's government set up a system, but it was only because there were inefficiencies there that he knew how to correct. He said that if LA County was already efficiently handling things, he couldn't add much value. But, he said that if LA County was doing things inefficiently then he would be happy to help.

The FBI took this to mean that he would be interested in a bribery scheme. Because, of course, most people who bribe their way into business only do that if there's a value add for the service they provide.

The FBI Sends A Lot of Unanswered Email

After that meeting, the FBI hounded Barta, and he didn't get back to them. Castro told Barta that their inside man was eager to close things. That went on for more than a month. Barta just ignored the emails.

Then the FBI started sweetening the deal - increasing the size of the fake contract that Barta would participate in. The FBI also pressured other folks to pressure Barta to get involved.

They had put a lot of work in. The FBI really wanted that stat.

When Barta responded to none of this, Castro started calling him. Barta let the calls go to voicemail.

The Ultimatum

Finally, Castro sent Barta an email saying if he didn't hear by the end of the day he was moving on.

Barta didn't get back to him. Castro didn't move on.

The Harried Phone Call and Nebraska Meeting

Finally, Castro called Barta and Barta's assistant put him through. Barta said he was in the middle of something else and wasn't able to talk. Castro asked if they could move forward. Barta said "I think we're probably ready to move . . . Yep."

Castro reached out to Barta over the next few weeks. He enlisted a guy who later became a co-defendant to reach out to Barta. Ultimately, Castro flew to Nebraska where Barta lived. Barta said he wanted to help his friend, but didn't really care about any deal in LA. He gave Castro a check from Sav-Rx for $6500.

He was arrested six days later and convicted after a jury trial.

The Seventh Circuit

The Seventh Circuit found this was entrapment as a matter of law and vacated his conviction. Here's the best part of the opinion:

The FBI frequently emailed and called Barta, with no response from Barta. These were "repeated attempts at persuasion." Id. at 435. The FBI invented false deadlines for Barta to commit to the deal and invented false problems for the Los Angeles County hospital system. These were "fraudulent representations." Id. The FBI significantly sweetened what would have already been an attractive deal to Barta and his codefendants. Here we have "promises of reward beyond that inherent in the customary execution of the crime." Id. And the FBI pressed Barta - both directly and through Buenrostro -- to make a deal that it had reason to believe Barta would be making mainly to benefit his less fortunate friend, Buenrostro. Here we have "pleas based on
need, sympathy, or friendship." Id. The presence of all these plus factors shows that the government induced Barta to commit a crime, one that the government concedes he had no predisposition to commit. That is enough to establish entrapment as a matter of law.

The moral of the story? If someone is really pushing you to do something illegal, make sure that there's only venue in Illinois, Indiana, or Wisconsin.

The government, in a criminal investigation, can issue a grand jury subpoena to collect evidence and put witnesses under oath. It can execute search warrants to go into a home or business and take documents. It can cut deals with people it thinks are involved in a criminal enterprise, so that they'll spend less time - or no time - in prison if they turn in someone else.

Someone fending off a government investigated can't do any of this.

Normally, if a person has information that would make someone who hears it think the person is guilty of a crime, that person has a right to refuse to talk about it. It's a part of the Fifth Amendment. The government has a fix for that problem too - if a witness won't talk, and won't play ball by cooperating, the government can ask a court to grant the person immunity. The statute that lets a court grant immunity is at 18 U.S.C. § 6003.

If a court grants a person immunity, that person cannot be prosecuted based on the information he provides. That's in 18 U.S.C. § 6002. There's an exception if the person lies or does something similar when immunized, but, beyond that, a person with immunity cannot be prosecuted for what they talk about.

Getting immunity can be a very good deal.

What about defense witnesses though? Surely, there are times when a person who is accused of a crime identifies a witness who he needs for his defense, yet the witness may get himself charged with a crime if he provides information.

For example, imagine that a witness knows a person accused of a crime didn't commit it, because the witness and the accused were across town counterfeiting money together at the time of the alleged crime. The witness refuses to testify and invokes his Fifth Amendment right not to - he doesn't want the government to put him in prison for the counterfeiting.

Can the defense ask the court to give immunity to the witness?* If so, when?

That was exactly the situation that the district court dealt with in United States v. Wilkes. The Ninth Circuit issued an opinion on this very question.

Mr. Wilkes was accused of bribing Congressman Duke Cunningham.** The government alleged that Mr. Wilkes made inappropriate gifts to the Congressman - including a trip to Hawaii where they enjoyed the beach, scuba diving, and prostitutes.

In exchange, Mr. Wilkes' company was alleged to have sold inferior products to the United States government.

A number of people testified against Mr. Wilkes. They worked for his company and the government had asked the district court to grant them immunity. The district court did. They testified against Wilkes.

One of Mr. Wilkes other employees would have told a different story. The district court listened to what Mr. Wilkes lawyer said the witness would say. The court concluded,

I have to tell you the proffer I have as to what this fellow can offer strikes me as material and relevant evidence that the defense would want to present to counter some of what's been presented by the United States through immunized witnesses.

So, naturally, the trial court ruled that

The court, having fully heard all counsel, denies the motion to convey use immunity.

The district court believed that it could only grant immunity if the prosecutors had intentionally engaged in misconduct. As the court saw things,

unless it's somehow tethered to the suggestion of prosecutorial misconduct, I don't think it's appropriate for the court to make determinations of who gets immunity and who doesn't. In the first instance, under our system of Government, that's a prosecutorial decision. And unless I can find that the way in which discretion was exercised was unfair so as to deny the defendant a due process right, then it's not appropriate for me to substitute my judgment for that of the prosecutor. I do have a concern about the effect of not granting immunity in this case, but I would have the same concern if it was a different privilege implicated over which I'd have no authority to pierce the privilege and order a witness to testify, any number of other privileges. So it's an effect that the criminal justice system lives with and accommodates.

One can imagine that the court's regret about this "effect" was not very comforting to Mr. Wilkes.

Straub held that a district court should order immunity when the testimony would be relevant and the prosecutor gave immunity to one witness, but not to another who would have contradicted the one the prosecutor choose, and that choice by the prosecutor

the effect of so distorting the fact-finding process that the defendant was denied his due process right to a fundamentally fair trial

(Keep in mind, friends who aren't from the left coast, the rule in your part of the country may be different.)

Based on this standard, the court of appeals remanded for a hearing on whether the district court should have immunized the witness under Straub. The appellate court did note, though, that "[t]he district court also repeatedly expressed its concern that not granting Williams immunity would have the effect of distorting the fact-finding process." So perhaps the court of appeals thought it knew how this would turn out.

The rest of the opinion in Wilkes is a bit bleak. I wouldn't read it unless you're a prosecutor or looking to be saddened.

* This is assuming the defense is willing to swallow a conviction on the counterfeiting. There's probably a better hypothetical out there.
** The opinion says that the total list of charges were "one count of conspiracy
(18 U.S.C. § 371), ten counts of honest services wire fraud (18 U.S.C. §§ 1343 and 1346), one count of bribery of a public official (18 U.S.C. § 201), and one count of money laundering (18 U.S.C. § 1956(a)(1)(B)(i))."

Federal employees are in a vulnerable position for an investigation by an Office of Inspector General (or OIG). Basically, an OIG investigation can run in two different directions. Each has it's own dangers that a federal employee who hears from an OIG Agent needs to be aware of.

If an OIG Agent is investigating a criminal violation of law, then the federal employee has the risk of being prosecuted. If the OIG Agent thinks he or she can prove that the federal employee committed a crime, and the OIG Agent can convince an Assistant United States Attorney to bring a case, then the federal government is bringing its resources to bear to convict the federal employee of a crime. Often, this means that the government wants a felony conviction, and it can quickly mean that prison time is a real risk.

If, however, the Assistant United States Attorney decides that a criminal prosecution is not warranted, either because there isn't enough evidence of a crime, or because what happened isn't serious enough to warrant a prosecution, or because what the OIG Agent is investigating isn't a violation of a criminal law, then the federal employee is still not in a good position, because he or she can lose his or her job. If criminal charges aren't an option, the OIG Agent can require that a federal employee give an interview. If the employee doesn't give the interview, then that can be a basis for a disciplinary action.

Federal employees face unique risks. They're conduct has its own law enforcement offices that are set up to investigate - aside from government contractors, OIG Agents spend a lot of time looking at federal employees.

For a federal employee who is under scrutiny by an OIG Agent, it is important to know what is happening, and what needs to be done to protect your job, and, possibly, your freedom.

For many federal contractors, TARP and the American Recovery and Reinvestment Act are a godsend. The economy isn't great overall, but the federal government is still spending. This is good for the economy around Washington, D.C., and it's good for those who sell services and products to the federal government.

The government, though, has a concern about fraud in government contracting. Some of this is generic. Every agent with an Office of Inspector General can tell you that his or her job is to combat waste, fraud, and abuse. Even in normal times, Inspector General offices spend a lot of time investigating whether federal contractors have engaged in fraud. As a result, even in normal times, government contractors need to take reasonable steps to prepare themselves in case an OIG agent comes calling.

Perhaps this will mean only that those who engage in shady activity have a higher likelihood of being prosecuted. What I worry will happen, though, is that the government will prosecute where it could better regulate, and that good, but perhaps sloppy, federal contractors, and their employees, will be caught up in politically created prosecutions and investigations.

The article above is an odd bit of journalism. The headline says that a Kuwaiti firm is "tied" to a scandal, but it isn't clear who "ties" the two together. As I read it, there is a bribery case in federal court that may involve, very tangentially, a Kuwaiti company. That company, in an unrelated matter, had a problem with a government contract that was treated a little strangely.

This is a nice example of how journalists have even fewer checks on their power than prosecutors. That this stuff gets published to make a company look bad is disappointing.

Here's the background:

An Army Major named Cockerham has entered a plea to taking about $9.6 million in bribes from a ledger that he maintained that said there were $15 million in bribes. [Note - if you're planning on taking bribes, do not keep them in a ledger.]

On the ledger, the Kuwaiti company, KMS Co., has an entry for $40,000, suggesting that the company gave the Major $40,000 in bribe money.

The company has other problems not related to the Major; it billed the government for gasoline that was reported stolen, and the reporter doubts that's an accurate description of why the gasoline didn't make it to the Army. The sanction for this missing gasoline is not what a source for the reporter says it should be.

The Major is cooperating with prosecutors, hoping to get more time off his sentence. The government isn't saying anything. The Major's defense lawyer says he doesn't know if they're going to talk about the $40,000 at sentencing.

I don't see any link in this story between the bribery investigation and the gasoline issue. Which makes me wonder who is feeding this story to the reporter.